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Zoe puts $6000 into an investment that pays interest at a compound rate of 3% p.a. Find the total amount of the investment after 10 years. Write appropriate units with your answer and round your answer to the nearest cent.

Options:
A) $7,650.02
B) $7,800.45
C) $6,301.34
D) $6,100.00

1 Answer

3 votes

Final answer:

The total amount of the investment after 10 years when $6000 is compounded annually at a rate of 3% is approximately $8053.04. The correct answer is not listed in the provided options.

Step-by-step explanation:

The student is interested in finding the total amount of an investment after 10 years, where the original sum of $6000 is invested at a compound interest rate of 3% per annum. To solve this, we use the formula for compound interest A = P(1 + r/n)^(nt), where A is the amount of money accumulated after n years, including interest, P is the principal amount (the initial sum of money), r is the annual interest rate (decimal), n is the number of times that interest is compounded per year, and t is the time the money is invested for in years.

In this case, since interest is compounded annually, n is 1. Thus, A = 6000(1 + 0.03/1)^(1*10).

Calculating this, we have A = 6000(1.03)^10, which equals approximately $8053.04. Therefore, the correct option that represents the total amount of the investment after 10 years to the nearest cent is not listed among the provided options.

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